Correlation Between Merck and Maxar Technologies
Can any of the company-specific risk be diversified away by investing in both Merck and Maxar Technologies at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Merck and Maxar Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merck Company and Maxar Technologies, you can compare the effects of market volatilities on Merck and Maxar Technologies and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Merck with a short position of Maxar Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merck and Maxar Technologies.
Diversification Opportunities for Merck and Maxar Technologies
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Merck and Maxar is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Merck Company and Maxar Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maxar Technologies and Merck is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Merck Company are associated (or correlated) with Maxar Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maxar Technologies has no effect on the direction of Merck i.e., Merck and Maxar Technologies go up and down completely randomly.
Pair Corralation between Merck and Maxar Technologies
If you would invest 5,299 in Maxar Technologies on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Maxar Technologies or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.8% |
| Values | Daily Returns |
Merck Company vs. Maxar Technologies
Performance |
| Timeline |
| Merck Company |
| Maxar Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Merck and Maxar Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merck and Maxar Technologies
The main advantage of trading using opposite Merck and Maxar Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merck position performs unexpectedly, Maxar Technologies can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Maxar Technologies will offset losses from the drop in Maxar Technologies' long position.| Merck vs. Pfizer Inc | Merck vs. Johnson Johnson | Merck vs. Highway Holdings Limited | Merck vs. QCR Holdings |
| Maxar Technologies vs. Comtech Telecommunications Corp | Maxar Technologies vs. NETGEAR | Maxar Technologies vs. KVH Industries | Maxar Technologies vs. Silicom |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |